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Prepared by Precision Advocacy
On October 22, Governor Gavin Newsom announced that California will deploy the National Guard and California Volunteers to assist food banks in distributing food to families. This measure, which mirrors a similar initiative during the March 2020 pandemic, is a response to a delay in November CalFresh benefits for 5.5 million Californians caused by the federal government shutdown. The governor will also fast-track up to $80 million in state funding for food banks. California distributes approximately $1.1 billion in CalFresh benefits monthly, with about $60 million allocated to Orange County.
Judicial Council Report on Prop. 36 Implementation
The Judicial Council of California submitted a preliminary report to the legislature on Proposition 36 implementation, which includes data from December 18, 2024, through June 30, 2025, by county for cases related to Health and Safety Code section 11395, known as the Treatment-Mandated Felony Act.
Passed by a majority of California voters in November 2024, Prop. 36 "The Homelessness, Drug Addiction, and Theft Reduction Act" reversed some criminal justice reforms from Proposition 47 (2014) by increasing penalties for repeat drug and theft offenses. It raised criminal penalties for some drug possession and theft convictions and created Health and Safety Code section 11395 and Penal Code section 666.1.
Prop. 36 also authorizes prosecutors, under certain conditions, to charge some drug and theft cases as felonies that would have previously been charged as misdemeanors and allows defendants facing drug possession charges who have two or more prior drug possession convictions to participate in drug treatment in lieu of custody time. These cases are known as “treatment-mandated felonies.”
The 2025 state budget provided $20 million to support the implementation of Prop. 36 over the next three years, of which $19 million will be distributed to trial courts. The allocation is meant to be used to address increased workload and to establish collaborative courts for the implementation of the proposition. Eligible uses include staffing, contracts to provide treatment or local supervision, data collection and reporting, training and other costs associated with implementation.
Following a survey of all 58 trial courts, 57 provided data to the Judicial Council, representing 99.7% of the population. Orange County reported 2,395 cases related to Health and Safety Code section 11395, with 144 in which the defendant elected treatment and 144 in which the defendant was ordered into treatment.
Based on the preliminary data, the Judicial Council estimates that the state may anticipate approximately 16,000 to 17,000 felony Health and Safety Code section 11395 cases annually. Of the 8,895 that were officially reported during the survey period, 15% of defendants statewide elected to participate in treatment. While considering the time constraints of the reporting period, 21% of those participants who had entered treatment had a judgment imposed on them due to unsatisfactory outcomes of or during the treatment program. Only 3% of participants who entered into treatment had their cases dismissed following successful treatment program participation. A substantial portion of the defendants who were referred to treatment were likely at various stages of the treatment process at the time of the survey.
The Judicial Council, in collaboration with the state Department of Health Care Services, will submit a more expansive report on Prop. 36 implementation by March 1, 2026, and annually until the funds are spent.
Legislative Analyst’s Overview of the 2025 Budget Act
The Legislative Analyst's Office (LAO) recently released several briefs on the 2025 Budget Act, including an overview of the 2025-26 spending plan. This update provides key takeaways in anticipation of the 2026 budget discussions. Notably, General Fund spending was reduced in most departments as compared to 2024-25, however a structural deficit remains for the foreseeable future.
Budget Deficit and Solutions. While the 2025 budget deficit ($15 billion) was smaller than in previous years ($55 billion in 2024-25 and $27 billion in 2023-24), it necessitated more ongoing solutions due to state service costs outstripping revenue. The June 2025 spending plan sustained $28 billion in budget solutions adopted in 2024 and included a $7.1 billion withdrawal from the Budget Stabilization Account (rainy-day fund).
The budget primarily addresses the deficit through borrowing, with nearly $10 billion in new borrowing for 2025-26, increasing the total outstanding budgetary borrowing from $12 billion to $22 billion. Approximately $11 billion in ongoing budget solutions were adopted, including $2.5 billion in spending reductions (projected to reach $10.5 billion annually by 2028-29) and $300 million in revenue increases. Revenue increases, stemming from a change in tax rules for multistate financial institutions on how taxable profits are determined, are expected to boost revenues by $330 million in 2025-26 and $250 million annually thereafter. Additionally, $3 billion in fund shifts were adopted, utilizing other funding sources for costs typically covered by the General Fund.
Projected Deficits and Reserves. Despite ongoing solutions, the administration's June 2025 projections indicate persistent annual operating deficits ranging from $15 billion to $25 billion for the 2026-27, 2027-28, and 2028-29 fiscal years.
Under these projections, the state is expected to conclude 2025-26 with $4.5 billion in the Special Fund for Economic Uncertainties (SFEU), which serves as the state’s operating reserve. While no funds were drawn from reserves for the 2023-24 budget, reserves have been utilized in 2024-25 and 2025-26. Specifically, $5 billion was drawn from the Budget Stabilization Account (BSA) in 2024-25 and an additional $7 billion in 2025-26, leaving an $11 billion balance in the BSA. The entire balance of the Safety Net Reserve (nearly $1 billion) was also used in 2024-25. Including the SFEU balance, the state's total reserves are projected to be nearly $16 billion at the end of 2025-26. Additionally, the state reserve for schools and community colleges will be fully withdrawn by the end of 2025-26.
Spending and Bond Funding. Total state spending for 2025-26 is projected to be $317 billion, a 5% decrease from 2024-25. The 2025 Budgate Act does not account for potential impacts of House Resolution 1: One Big Beautiful Bill Act (H.R. 1), signed by the President on July 4.
The 2025 Budget Act includes the initial allocation of Proposition 2 bond funding, which authorizes $10 billion in state general obligation bonds for school ($8.5 billion) and college ($1.5 billion) facilities. The budget allocates $1.5 billion for school projects and authorizes preliminary plans and working drawings for 29 new community college projects, plus the design-build phase for one existing student housing project, totaling $863 million across all phases of these 30 projects.
The budget also appropriates $3.5 billion from Proposition 4, the $10 billion climate bond approved by voters in November 2024 and $4.1 billion from the Greenhouse Gas Reduction Fund (GGRF).
Housing, Homelessness, and Local Government. The 2025-26 budget includes significant funding and policy shifts impacting housing, homelessness, and local government.
- The Business, Consumer Services and Housing Agency (BCSH) will undergo a reorganization, splitting into two separate agencies by July 1, 2026:
- California Housing and Homelessness Agency (CHHA)
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California Interagency Council on Homelessness (Cal ICH): Beginning in 2026-27, Cal ICH will become a separate entity under CHHA.
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Housing Development and Finance Committee: This new committee will centralize the administration of various affordable housing programs currently dispersed across BCSH departments.
- Funding for Homelessness Initiatives
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Homeless Housing, Assistance, and Prevention (HHAP) Program: The 2025 budget package plans for a $500 million one-time General Fund appropriation for HHAP in the 2026-27 fiscal year (Round 7). This funding will bring the total General Fund support for HHAP to approximately $5 billion since 2019-20.
- The allocation is contingent on future legislation to enhance grantee accountability, including local encampment policies and progress on housing performance metrics.
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Encampment Resolution Funding (ERF) Grants: The 2025-26 Budget Act appropriates an additional $100 million one-time General Fund for Round 5 of the ERF initiative, bringing the total General Fund support to nearly $1 billion since 2021-22. Budget trailer bill AB 130 extends the expenditure deadline for grantees from two fiscal years after appropriation to two fiscal years after the awarding of funds.
- Funding for Affordable Housing and Homeownership
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California Dream for All Program: The budget appropriates $300 million one-time General Fund for the program, which provides downpayment assistance to eligible first-time, first-generation homebuyers. This is the third round of funding, following $500 million in 2022-23 and $20 million in 2023-24.
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Multifamily Housing Program (MHP): $120 million one-time General Fund is provided for MHP, the Department of Housing and Community Development’s flagship affordable housing program, with 10% set aside for California tribes.
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Low-Income Housing Tax Credits (LIHTC): $500 million is authorized for the state LIHTC program, in addition to approximately $130 million in statutorily required tax credits. This marks the seventh consecutive year of a $500 million tax credit authorization.
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Reversion of Unspent Housing Funds: $38 million in unspent funds from prior fiscal years, originally allocated for the Infill Infrastructure Grant (IIG) Program, IIG Catalytic Program, and Commercial Property Pilot Program, will be reverted to the General Fund.
- Amendments to Environmental and Planning Regulations
- Three budget trailer bills amend California Environmental Quality Act (CEQA) requirements:
- Narrowing the scope of environmental reviews for housing projects nearly exempt from CEQA.
- Eliminating CEQA review for local governments rezoning neighborhoods to meet state-mandated housing goals (with restrictions).
- Creating new CEQA exemptions for various projects, including infill housing, farmworker housing, rural health clinics, day care centers, food banks, broadband deployment, and advanced manufacturing facilities.
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Statewide Vehicles Miles Traveled (VMT) Mitigation “Bank”: A new option allows developers to pay a fee to mitigate VMT impacts, with revenue deposited into an HCD-administered fund for VMT-reducing projects (e.g., affordable housing near transit). The Governor’s Office of Land Use and Climate Innovation will issue initial guidance by July 2026.
- Other Housing-Related Policy Changes
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Coastal Commission: Budget trailer bill language shortens housing permit review times under the Permit Streamlining Act from 180 to 90 days. It also prohibits appeals of local permits for multifamily housing (four or more units) in the coastal zone based on location in a sensitive coastal resource area or not being the principally permitted use.
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Building Standards: The budget imposes a six-year suspension (through mid-2031) of new residential-building standards by state and local governments, with exceptions for health and safety and other specified areas.
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Reinvestment of Equity in Affordable Housing Projects: Affordable housing developers funded by HCD can now access and reinvest equity from their projects to finance other affordable housing projects, subject to limitations.
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Homeless Shelters: Local governments are now required to perform annual inspections of all homeless shelters in their jurisdiction to ensure compliance with health and safety standards. Trailer bill legislation mandates prominent display of occupants’ rights and complaint procedures in shelters.
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Municipal Stormwater Permits: The budget suspends four mandates concerning municipal stormwater permits issued by regional water quality control boards for the period from 2009 or 2010 through December 2017. This retroactive suspension saves approximately $4 million one-time in 2025-26. Subsequent budget acts would be needed to continue this suspension for past claims.
Health. California's 2025-26 health spending plan totals nearly $50 billion General Fund, a 16% increase, primarily driven by Medi-Cal. The budget includes $4.7 billion in Medi-Cal solutions for 2025-26, projected to nearly double to $8.6 billion by 2028-29, many of which are ongoing and focus on individuals with unsatisfactory immigration status (UIS). Total Medi-Cal spending across all funds is $197 billion in 2025-26, a 10% increase.
Key budget solutions include:
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UIS Population: Freezing comprehensive Medi-Cal enrollment for undocumented adults (saving $78 million in 2025-26, growing to $3.3 billion by 2028-29), implementing a $30 monthly premium for UIS adults (saving $700 million annually starting 2027-28), reducing payments to safety net clinics for UIS services (saving $1 billion annually starting 2026-27), and ending dental coverage for UIS adults (saving $300 million annually starting 2026-27).
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Medi-Cal Loan: Borrowing $4.4 billion General Fund over two years for the Medi-Cal Provider Interim Payment Fund, with repayment delayed over a decade, scoring as savings in 2024-25 and 2025-26.
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Proposition 35/MCO Tax: Implementing new rules from Proposition 35, allocating more funding for augmentations, including covering underlying growth in managed care costs, which is scored as a budget solution.
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Prescription Drugs: Eliminating coverage for certain optional pharmacy benefits, notably GLP-1 agonists for obesity (saving $85 million in 2025-26, rising to $790 million by 2028-29), promoting higher drug rebates from manufacturers (saving $370 million in 2025-26, rising to $600 million annually), and adopting new utilization management practices (saving $175 million in 2025-26, rising to $350 million annually).
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Other Solutions: Reinstating an asset test for seniors and persons with disabilities to determine Medi-Cal eligibility (saving $45 million in 2025-26, rising to $510 million annually), achieving savings from operational efficiencies at DHCS, eliminating supplemental dental payments (saving $362 million annually starting 2026-27), eliminating the Skilled Nursing Facility Workforce and Quality Incentive Program (saving $70 million in 2025-26, rising to $140 million annually), and requiring prior authorization for hospice services (saving $50 million annually starting 2026-27).
Public Health. Total funding for the California Department of Public Health (CDPH) is $5.2 billion in 2025-26, with General Fund spending down by $143 million (15%) due to the end of temporary funding, partially offset by one-time support for IT systems and reappropriations for public health equity initiatives. State vaccine guidance is also modified.
Health Care Access and Information (HCAI). General Fund spending for HCAI is decreasing in 2025-26 due to the ramp-down of one-time and carryover spending. Key actions include funding a new five-year behavioral health workforce initiative ($1.9 billion, mostly federal funds), reducing funding for the CalRx Insulin Initiative by $45 million, supporting a new two-year diaper access initiative, providing one additional year of funding for the Health Care Payments Database, funding three external entities, and increasing regulation of Pharmacy Benefit Managers.
State Hospitals. General Fund spending for the Department of State Hospitals (DSH) decreases by $166 million (6%) in 2025-26, mainly due to reductions in funding for programs addressing the Incompetent-to-Stand-Trial (IST) waitlist. DSH has met the court-mandated 28-day treatment deadline for IST individuals.
Proposition 4: Climate Bond. The budget package provides $3.5 billion in 2025-26 for Proposition 4 climate bond spending - 35% of the $10 billion total. The funding varies by category, with much higher shares for park creation and outdoor access (67% of the total pot) and wildfire and climate smart agriculture (51% of the total pot) than for other categories - in particular coastal resilience which only allocated 23% of the total pot. According to the LAO, this is because departments need to substantively update program guidelines or develop a new program, or because funding is still available for similar purposes from previous budget appropriations.
- About $300 million was shifted from utilizing General Fund to instead providing Proposition 4 funding for similar activities. In some cases, the projects that end up being funded may differ slightly from those that might have been funded with General Fund.
- Timing of future allocations is still to be determined, as only 2025-26 appropriations were allocated
- The budget package authorizes nearly 80 new positions across 12 departments to administer Proposition 4 funded programs.
- Budget trailer bill language authorizes administering departments to use emergency regulations to develop and adopt guidelines and selection criteria to allow departments to move more quickly compared to if they had to adopt regulations following the standard process.
Natural Resources and Environmental Protection. The 2025-26 budget allocates $19.7 billion from various sources to the California Natural Resources Agency (CNRA) and CalEPA. This represents a 72% decrease from the estimated expenditure levels of 2024-25, primarily due to the expiration of significant one-time funding and carried-over funds from previous years.
General Fund Savings and Greenhouse Gas Reduction Fund (GGRF) Shifts. The budget achieves General Fund savings by reallocating funding for two environmental activities to other sources, avoiding programmatic impacts:
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CalFire Operations: $1 billion from the GGRF will support CalFire operations.
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Exide Facility Cleanup: $35 million from the Lead-Acid Battery Cleanup Fund will assist the Department of Toxic Substances Control (DTSC) in cleanup efforts at the Exide facility and surrounding communities.
Future GGRF Funding for CalFire (Conditional on Budget Deficit). The budget includes intent language for additional GGRF funding for CalFire in future years to achieve General Fund savings, assuming a budget deficit:
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2026-27: $1.25 billion
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2027-28: $500 million
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2028-29: $500 million
However, if a General Fund deficit is not projected for 2026-27, GGRF funding for CalFire will be limited to $500 million for that year.
GGRF Expenditure Plan (2025-26). The 2025-26 GGRF expenditure plan totals $4.1 billion:
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Statutorily Required Appropriations ($2.4 billion): Funding for high-speed rail, housing, transit, forest health, and drinking water programs.
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Discretionary Spending ($1.7 billion):
- $1 billion for the CalFire fund shift.
- $81 million to cover costs typically paid from the Motor Vehicle Account.
- $368 million for the Transit and Intercity Rail Capital Program.
- $100 million for addressing local air pollutants in disadvantaged communities (AB 617).
- $65 million for two Zero-Emission Vehicle (ZEV) related programs.
- $7 million for livestock methane reduction.
Efficiency and Vacant Position Reductions. The budget reduces $189 million across CNRA and CalEPA in 2025-26 and ongoing through efficiency measures and vacant position reductions. This includes:
- $38 million from the Department of Fish and Wildlife.
- $29 million from the State Water Resources Control Board.
- $25 million from the California Air Resources Board.
- $53 million from the General Fund and $136 million from special funds.
Agency-Specific Budget Details
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California Natural Resources Agency (CNRA): $273 million from various sources in 2025-26, a $446 million (62%) decrease due to the expiration of one-time funds. $91 million is appropriated from Proposition 4.
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Department of Forestry and Fire Protection (CalFire): $4.5 billion from various sources in 2025-26, a $667 million (13%) decrease. Includes $279 million from Proposition 4 and a $1 billion shift from GGRF, reducing the General Fund contribution commensurately. The budget also provides $39 million General Fund in 2025-26, with intent language to provide $78 million in 2026-27 and ongoing, to transition some seasonal firefighter positions to permanent status. Additionally, $9.5 million General Fund is allocated for the California Fire Safe Council’s Wildfire County Coordinator Program.
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Department of Parks and Recreation: $1.2 billion from various sources, a $494 million (28%) decrease due to expiring funds. Includes $440 million from Proposition 4 for the Statewide Parks Program, focusing on climate impact reduction, outdoor recreation expansion, and deferred maintenance.
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Department of Water Resources: $3 billion from various sources, a $2 billion (40%) decrease primarily due to expiring one-time funds. Appropriates $684 million in Proposition 4 funding for water resilience projects and reduces prior General Fund augmentations by $80 million.
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State Lands Commission: Approves $4.1 million in 2025-26, $4.1 million in 2026-27, and $4.4 million in 2027-28 for restoration activities at the Bolsa Chica Lowlands in Orange County, including tidal inlet dredging and ongoing maintenance.
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California Coastal Commission: Approves $565,000 in 2025-26, $1.2 million in 2026-27, and $1.8 million in 2027-28 and ongoing to assist local coastal governments in aligning Local Coastal Programs with housing element zoning changes (as required by AB 3093).
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California Energy Commission: $1.4 billion from special and federal funds in 2025-26, a $2.8 billion decrease from 2024-25 due to expiring one-time funding. This decrease is partially offset by one-time augmentations, including $275 million from Proposition 4 for offshore wind projects and $40 million from GGRF for heavy-duty ZEV charging infrastructure.
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California Air Resources Board (CARB): $956 million in 2025-26, almost entirely from special funds, a significant decrease from $1.4 billion due to expiring one-time funding. Includes $132 million for hybrid and zero-emission truck and bus voucher incentives and $20 million to augment the Clean Cars 4 All program.
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State Water Resources Control Board (SWRCB): $1.9 billion from all funding sources in 2025-26, including $74 million from the General Fund. This is a $574 million (24%) reduction, mainly due to the expiration of prior one-time and bond funding. The spending plan reduces 2024-25 General Fund spending on water recycling by $51 million and omits previously planned 2025-26 GGRF augmentations of $15 million for water recycling and groundwater cleanup and $30 million for drinking water and wastewater. Proposition 4 spending offsets some of these modifications.
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Department of Toxic Substances Control (DTSC): $448 million from various sources in 2025-26, a $166 million (27%) decrease. This largely reflects the expiration of one-time General Fund for brownfield remediation and Exide facility cleanup.
Next month, we anticipate the LAO will release its fiscal outlook for 2026. We will keep you posted on developments related to the state budget anticipated to impact the county.
September Revenues
The Department of Finance (DOF) and State Controller released their reports on September revenues as compared to the 2025 Budget Act.
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Tax Revenues
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DOF September
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DOF 2025-26 YTD
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Controller 2025-26 YTD
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Personal Income
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$2.349 billion above projections
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$3.717 billion above projections
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3.942 billion above projections
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Corporation
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$46 million below projections
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$186 million below projections
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$90.376 million below projections
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Sales and Use
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$45 million below projections
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$122 million below projections
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$76.885 million below projections
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Total Revenues
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$2.058 billion above projections
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$3.815 billion above projections
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$4.217 billion above projections
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Grant Opportunities
Below is a list of the latest grant opportunities released by the state. All opportunities for local jurisdictions may be found here.
Deadline: 12/15/25 14:00
Title: Trauma Recovery Center Grant Fiscal Year 26/27
State Agency / Department: Victim Compensation Board
Match Funding? No
Estimated Total Funding: Funding for TRCs varies each year with $2,000,000 from the Restitution Fund and a percentage of savings from the Safe Neighborhoods and Schools Fund (SNSF) that varies annually
Funding Method: Reimbursement(s)
Deadline: 11/21/25 12:00
Title: Representative Precision Medicine Research Through Partnerships
State Agency / Department: CA Health and Human Services Agency
Match Funding? No
Estimated Total Funding: $6,000,000
Funding Method: Reimbursement(s)
Governor’s Press Releases
Below is a list of the governor’s press releases beginning October 15.
October 22: California expands CalAssist Mortgage Fund Disaster Relief: More California families to qualify for mortgage grants
October 22: California to deploy National Guard to support food banks, fast-track funding as Trump’s shutdown strips families of food benefits
October 21: Governor Newsom announces appointments
- Ukau Dungca, of El Dorado Hills, has been appointed to the California State Lottery Commission
- Rodney Ellison, of West Sacramento, has been reappointed to the State 9-1-1 Advisory Board
- Mark Chase, of Oakland, has been reappointed to the State 9-1-1 Advisory Board
- Kurt Wallace, of Anaheim, has been reappointed to the State 9-1-1 Advisory Board
October 21: TOMORROW: Governor Newsom to discuss the economic advancement and growth of the state
October 21: Governor Newsom to Trump: We’re suing immediately if you send troops into San Francisco
October 21: Governor Newsom honors fallen La Mesa Police Department Officer
October 21: California’s Cannabis Task Force Seizes and Eradicates Over $222 Million in Illegal Cannabis in Q3 2025
October 21: Governor Newsom announces tax credit awards for new job-creating films shooting in
October 21:California and generating $1.4 billion for the state’s economy
October 21: Governor Newsom announced as co-chair for the COP30 Local Leaders Forum in Rio de Janeiro
October 20: Trump shutdown could soon halt food support for millions in California; CalFresh cards face possibility of no new funds in November
October 20: Governor Newsom to the Supreme Court: do not let Trump use the military against American communities
October 20: Governor Newsom supports workers as Trump’s shutdown hurts the economy
October 20: California strengthens its pipeline for good-paying jobs, providing $25 million to train more than 22,000 workers through apprenticeship programs
October 20: While the Trump administration cuts programs to fight hate crimes, California is taking action every day
October 20: While the Trump administration cuts programs to fight hate crimes, California is taking action every day
October 18: White House to fire explosive artillery over major roadway in Southern California, I-5 to be temporarily shut down on Saturday due to life safety risk
October 17: Governor Newsom announces appointments
- Andrew “Dru” Alejandre, of Corning, has been appointed Executive Secretary of the California Native American Heritage Commission
- Matthew Notley, of Sacramento, has been appointed Deputy Director of Crisis Communications at the California Governor’s Office of Emergency Services
- Audrey Boochever, of Sacramento, has been appointed Senior Policy Director at the State Board of Education
- Kathryn Jue, of Wilton, has been appointed Workforce Diversity Specialist at the California Department of Developmental Services
- Richard “Rick” Simpson, of Sacramento, has been appointed to the Commission on Teacher Credentialing
- Rafael Sweet, of Los Angeles, has been reappointed to the Board of Chiropractic Examiners
- Janette Cruz, of Sacramento, has been reappointed to the Board of Chiropractic Examiners
October 17: California invests nearly $5 billion for local projects to improve roadways, new alternative transport options
October 16: Hundreds of new homes for veterans are coming to California through voter-approved Prop 1 funding
October 16: California highlights earthquake preparedness for Great ShakeOut Day
October 16: Governor Newsom expands response arsenal with new emergency services facility in Southern California
October 16: Governor Newsom announces affordable CalRx® insulin, $11 a pen, will soon be available for purchase
October 15: TOMORROW: Governor Newsom to make major announcement on lowering drug costs
October 15: Federal reductions to critical services threaten public safety as flood season gets underway in California
October 15: California steps up to help military, veteran families while the federal government is AWOL
YIMBYs rejoice! Leaders celebrate Governor Newsom’s landmark actions this year to boost housing and affordability
October 15: Governor Newsom calls for congressional investigation into vile, antisemitic and violent messages from MAGA organization
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Prepared by Townsend Public Affairs
LEGISLATIVE BRANCH ACTIVITY
Government Shutdown Continues with Little Movement on Negotiations, Social Safety Net Programs to Cease Benefit Payments in November
The government shutdown continued this week as both parties in Congress slightly changed their messaging but did not substantively advance negotiations. Republican majority leadership maintains that seven Democratic senators must vote to advance the House-passed ‘clean’ continuing resolution (CR), HR 5371, to fund the government at FY25 levels through November 21. Senate Majority Leader John Thune recognized that their CR may not be long enough given the standoff and suggested they could introduce a new version with a longer timeframe. A new CR would require House Speaker Mike Johnson to bring the House back into session, which he has declined to do in order to maintain pressure on Senate Democrats.
At the end of the month, many programs that have continued to pay benefits using leftover FY25 funding will exhaust their available funds and further limit operations. All non-defense and immigration federal agencies have implemented contingency plans detailing changes to their operations because of the shutdown. These plans are expected to be updated before October 31 and include the:
The most notable program at risk should the shutdown continue is the Supplemental Nutritional Assistance Program (SNAP/CalFresh), which will expend all FY25 funding by the end of the month and will likely stop benefits payments after November 1. The same applies to the Temporary Assistance for Needy Families (TANF/CalWORKS) program, the Commodity Supplemental Food Program (CSFP), and the Child and Adult Care Food Program (CACFP), which will have to separately reassess remaining funding at the end of October.
Per agency contingency plans, the Trump Administration intends to continue paying benefits to the maximum extent possible and limit the use of remaining FY25 funding for administrative or outreach work. This could allow the programs to remain operational for a short period after the end of the month, enabling beneficiaries to continue receiving payments even as the federal government stops reimbursing state and local partners for administrative costs.
Both parties in Congress see the start of November as the next major pressure point to reach a funding agreement, as several key events converge including the potential lapse of social safety net benefits, the mailing of health insurance premium increase notices, and another round of missed paychecks for federal workers.
Congress to Reorganize Fall Priorities Post Shutdown
To increase pressure on the Senate to act on the House-passed ‘clean’ continuing resolution (CR) and to avoid additional procedural votes, Speaker Mike Johnson has kept the House out of session, with members remaining in their districts since before the shutdown began.
This has caused significant delays in what was anticipated to be a busy fall working on a variety of issues that saw progress during the August recess. Among those include the upcoming 2026 Surface Transportation Reauthorization Act, a partial Farm Bill to authorize programs not included in HR 1, permitting reform legislation, a second set of cryptocurrency or stablecoin bills, and artificial intelligence regulations. The National Defense Authorization Act (NDAA) progressed in the Senate through the shutdown and is now in conference between the two chambers.
Given the shortened time frame before the end of the year, and the general cycle of Congress, leadership is working to prioritize legislation to consider in the fall before the second session of the 119th Congress begins in January. It is likely the Farm Bill provisions not included in the OBBBA and the NDAA will take priority.
Committee on Banking, Housing, and Urban Affairs Holds Hearing on Innovation in US Housing
The Senate Committee on Banking, Housing, and Urban Affairs held a hearing on October 22 titled, Innovation in U.S. Housing: Solutions and Policies for America’s Future. The hearing primarily touted the potential benefits of passing S 2651, the ROAD to Housing Act of 2025, which was engrossed in the 2026 National Defense Authorization Act and passed out of the Senate in early October. The bill is currently in conference with the House.
The witnesses emphasized the importance of disaster preparedness and insurance availability for new housing developments nationwide, advocated for constructing homes appropriately anticipating natural disasters, and focused on the expansion of modular construction practices to reduce costs and more efficiently use skilled labor.
Senate Advances Wildfire and Air Safety Legislation
Continuing to work through the government shutdown, the Senate advanced legislation addressing aviation safety concerns surrounding the January crash in Washington, DC and wildfire legislation partially authored by California Senator Alex Padilla.
S 2503, The Rotorcraft Operations Transparency and Oversight Reform (ROTOR) Act strengthens military flight regulations and disallows the military from declining to use or install civilian compatible transmitters on military aircraft. It also requires the Federal Aviation Administration (FAA) to review and evaluate helicopter routes near major airports and take additional deconfliction measures.
S 1462, the Senate version of the Fix Our Forests Act with House companion HR 471, which passed the House in January, would initiate a series of regulatory and programmatic changes designed to support wildfire prevention in western states. The Senate version would create new programs and designate cross-jurisdictional “firesheds” to promote collaboration. It would also create a single interagency program for edge communities to build and retrofit infrastructure to be wildfire resistant and expand federal programs supporting forest health.
Given the bipartisan and bicameral nature of the bills, they are prime candidates to receive floor votes in the Senate before the end of the year.
EXECUTIVE BRANCH ACTIVITY
Trump Administration Seeks to Use Tariff Revenue to Cover Programs and Troop Pay During Shutdown
The Trump Administration has sought to use the over $200 billion in revenue brought in by increased tariffs to temporarily fund some programs and pay some federal workers during the government shutdown. Some in Congress have disputed the President’s authority to expend the funding without Congressional authorization.
Since the start of the President Trump’s second term, the Administration has exerted greater control over funding previously appropriated by Congress, realigning it with their priorities, freezing, and impounding funds without the explicit consent of Congress. With Congress, the Administration successfully rescinded previously appropriated funds and argued they could use the end of the fiscal year to conduct additional ‘pocket’ rescissions.
Several appropriators and the Government Accountability Office (GAO) have raised concerns about the Administration’s position that it is not required to administer certain portions of appropriations bills or that it may obligate funds without enacted appropriations. In response to these concerns, Senator Ron Johnson introduced S 3012, the Shutdown Fairness Act, which would ensure pay for federal employees required to work during the shutdown. Democratic lawmakers have indicated they plan to propose an alternative measure that would also provide pay for furloughed employees and include additional limits on administrative authority.
The Administration’s expanded involvement in the management of federal funding has continued to introduce uncertainty for local jurisdictions that depend on these resources, influencing how they prepare for potential fiscal challenges.
Orange County Delegation Press Releases
- Mike Levin – October 18, 2025: NEWS: Rep. Mike Levin’s Statement on Newly Reported Road Closures for the Marine Corps 250th Birthday Celebration at Camp Pendleton
- Mike Levin – October 15, 2025: Rep. Mike Levin’s Statement on Reported Traffic Plans Related to the Marine Corps 250th Birthday Celebration
- Lou Correa – October 15, 2025: LOOK OUT: ORANGE COUNTY HEALTH CARE PREMIUMS SET TO INCREASE DUE TO BIG UGLY BILL
- Dave Min – October 20, 2025: Rep. Dave Min Slams Trump Administration For Deprioritizing Prosecutions of Drug Cartels and Violent Offenders, Demands Answers in New Letter
- Derek Tran – October 16, 2025: Representative Tran Meets with Military Families Impacted by Shutdown
- Linda Sanchez – October 21, 2025: Sánchez, Sewell lead 54 Democrats demanding answers on $20 Billion Argentina Bailout | Congresswoman Linda Sanchez
- Alex Padilla – October 21, 2025: Senate Advances Fix Our Forests Act, Marking Key Progress to Combat Wildfires
- Adam Schiff – October 22, 2025: NEWS: Sen. Schiff Leads Senate Democrats in Demanding Answers from Trump Envoy Steve Witkoff on Failure to Divest Ownership of World Liberty Financial Crypto Assets
- Adam Schiff – October 21, 2025: NEWS: Sen. Schiff, 45 Senate Democrats Urge Donald Trump to Reinforce Opposition to West Bank Annexation
- Adam Schiff – October 18, 2025: WATCH: On ‘No Kings Day,’ Sen. Schiff Invokes the Spirit of the America’s Founding Fathers in Message to California Rally Attendees
- Adam Schiff – October 17, 2025: STATEMENT: Sen. Schiff Blasts Trump Administration’s Free Pass to Citibank for Armenian Discrimination Through Termination of Case Settlement
- Adam Schiff – October 17, 2025: NEWS: Sen. Schiff Joins Kaine, Paul to Force Vote Blocking Unauthorized War in Venezuela
- Adam Schiff – October 16, 2025: NEWS: Sen. Schiff Joins Sens. Blumenthal and Reed in Calling Out Noem’s Blatant Violation of Hatch Act with Partisan Airport Video
Legislation Introduced by the Orange County Delegation
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Bill Number
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Bill Title
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Introduction Date
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Sponsor
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Bill Description
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Latest Major Action
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H.R. 5788
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504 Program Risk Oversight Act
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10/17/2025
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Rep. Derek Tran (D-CA-45)
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To amend title V of the Small Business Investment Act of 1958 to require an annual portfolio risk analysis of loans guaranteed under such title, and for other purposes.
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Referred to the House Committee on Small Business.; 10/10/25
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